Bank of Russia refines requirements for pension reserves investment

The Bank of Russia has prepared a draft ordinance which establishes requirements for the investment of pension reserves of non-governmental pension funds (NPFs).

With due account for the launched stress-testing mechanisms and fiduciary responsibility, the NPF project enables funds to independently invest pension reserves without involving management companies.

The document establishes additional requirements for the quality of assets in which the main part of pension reserves may be invested. At the same time, the range of investment possibilities in riskier assets is expanding, however their share shall not exceed 10% of an investment portfolio. Furthermore, a number of additional risk requirements are being introduced; they are focused on the pension reserves investment procedure.

The proposed changes are aimed at enhancing the protection of rights and legitimate interests of funds’ participants and the efficiency of funds’ investment activities.

The approval of draft ordinance is scheduled for 2019 Q3.